First Deputy Prime Minister Mykola Azarov was due to make his maiden voyage to Washington this week to lead the Ukrainian side at the meeting of the U.S.-Ukrainian Committee for Economic Co-operation.
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At the last minute, however, Azarov begged off the trip, citing illness. Some in the parliament suggest that Azarov’s flu was of a diplomatic nature, based on an evaluation that glad-handing with some of the visitors from the CIS, particularly those from Moscow, might serve his long-term political interests much better than trooping around on what is expected to be a fruitless trip to Washington.
Instead Economy Minister Valery Khoroshkovsky led the Ukrainian delegation, with back-up from National Bank of Ukraine deputy head Oleksandr Shlapak, and Energy Minister Serhy Yermilov.
Back-channel information out of Washington suggests that U.S.-Ukraine relations are also on the sick list, continuing to suffer from the lingering effects of the Kolchuga scandal. With President Bush busily looking for allies for his war against Iraq, it might be that cozying up to a country that is accused of selling arms to Baghdad was more than the system could bear.
Khoroshkovsky and company have busied themselves with all the usual meetings at the State Department and the White House, but it’s hard to get the rapt attention of American interlocutors when they’re busy fitting their helmet and gas masks for the war ahead.
The meetings at IMF and World Bank might have proven more friendly, but hardly more productive.
Yushchenko on Washington merry-go-round
A second and unofficial troop, Viktor Yushchenko and company, will be arriving in Washington on Feb. 4. The Yushchenko trip appears to mark the end of any illusions he might have about the possibility of friendly relations with the president during the upcoming presidential election campaign.
Yushchenko’s interviews with the major wire services ahead of the visit appeared to put even more daylight between him and the president. Kuchma is unlikely to take kindly to Yushchenko’s description of the goal of the Washington trip as restoring mutual trust and repairing “seriously damaged” ties.
Yushchenko is certain to have the presidential blood pressure rising with such comments as, “The loss of credibility we’ve suffered over the last few years has put us back where we were in 1993 … when we just started building trust and began forming important economic and political ties.”
Back to chopping up the energy sector
While the president was off on his Middle East trip early last week, Prime Minister Viktor Yanukovych was busy with more practical things like preparing the energy sector, including Naftogaz Ukrainy, for a takeover by the Donetsk Clan.
In formal terms, Naftogaz was already subordinate to the Cabinet, but the real control has long been with the Presidential Administration. Then, on Jan. 18, the Yanukovych government issued a decree on transferring corporate management of Naftogaz to the Fuel and Energy Ministry. The result of this move would have been to divert some of the largest cash flows in the country at a time when those with presidential ambitions are busy lining up sources of cash for their election campaigns.
Right after his return from the Middle East, President Kuchma on Jan. 24 commissioned the State Property Fund to cancel, by April 1, all general agreements about transfer of authority to manage the corporate rights of state companies to ministries and other executive bodies. Kuchma also ordered the SPF to break all contracts concerning management by business entities of state-owned share packages. The immediate consequence of this presidential initiative is that Naftogaz cash flows, contracts etc. will remain firmly under the administration.
Rada sources explain the somewhat peculiar use of the State Property Fund in this case as a handy convenience, given the usual compliant attitude of top SPF management.
The real question at this point is whether this high-risk operation to transfer energy cash flows will result in casualties in the Cabinet.
